Najib’s ‘liberal’ New Economic Model led to rejection, think-tank suggests

PETALING JAYA, March 24 ― Datuk Seri Najib Razak had faced strong opposition against his New Economic Model (NEM) because the policy was economically liberal, local think-tank Institute for Democracy and Economic Affairs (IDEAS) said today.

IDEAS chief executive Wan Saiful Wan Jan suggested the opposition was a result of Najib’s attempt to “change the society towards a more liberal perspective” socially, politically and economically when he took over as prime minister.

“The New Economic Model is about a market-driven economy, but you can see that he had such a difficult time promoting the New Economic Model; the reason is the Malaysian population ― especially the Malay population that he has to answer to ― is opposed to economic liberalism.

“So clearly he failed to change the minds of the people who he had to listen to. So when you look at the ethnicity of people who are supportive of protectionism, the majority of them are Malays,” he told reporters here after releasing the survey results.

Wan Saiful cited Najib's 1Malaysia concept and the Political Transformation Programme as examples of initiatives that had elements of social and political liberalism, while NEM as one with elements of economic liberalism.

Najib had ultimately faced huge opposition to the NEM as there was a failure to sufficiently educate the Malays to change their opinion, he said.

“I think Najib as prime minister and president of Umno, he focused too much on the people who were supportive of economic liberalism and forgot his biggest stakeholder is actually Umno, so he forgot to educate his own party members about why economic liberalism is needed and as a result they opposed him,” he added.

Wan Saiful explained the recent survey which IDEAS commissioned showed that the majority of those polled were supportive of social liberalism and political liberalism which touches on ideas such as free and fair election, freedom of speech and freedom to choose how to live ones' life, but were sceptical about economic liberalism.

Of protectionism and GLCs

Under the survey carried out by independent pollster Merdeka Center, one of the questions gauging Malaysians' attitude towards economic liberalism saw 53.6 per cent of the 1,207 polled leaning towards protectionism by the government, while 36.9 per cent supported free trade, and with 8.5 per cent and 0.9 per cent saying they were unsure or refusing to answer.

In the breakdown according to ethnicity, 59 per cent of Malay respondents felt the statement that the government should control domestic and international trade and subsidise Malaysian companies was closer to their opinion, while 35 per cent chose the second statement that unsubsidised free trade would make Malaysia competitive and benefit businesses and consumers in the long run.

As for the Chinese respondents polled, more of them opted for free trade at 46 per cent against 37 per cent who chose protectionism. Indian respondents polled mostly chose protectionism at 74 per cent against 22 per cent for free trade.

As for the Bumiputera community in Sabah and Sarawak surveyed, their support for protectionism was at 60 per cent regardless of their religion, while the support for free trade among those of them who were Muslim and non-Muslim differed slightly at 37 per cent and 33 per cent respectively.

The other question to evaluate attitude towards economic liberalism saw an overall high support of all 1,207 surveyed, with 50 per cent believing an open economy without government-linked companies (GLCs) would be beneficial to Malaysians as it would create fair competition, opportunities for all, more jobs and more economic growth.

Those that felt that such benefits would be created with the government playing a big role in the economy with many GLCs amounted to 39.5 per cent, while 10.6 per cent and 0.8 per cent said they were unsure or declined to answer.

More Malay respondents felt there should be an open economy at 49 per cent as compared to 43 per cent who preferred heavy GLCs presence, while over half (55 per cent) of Chinese respondents chose an open economy compared to a little over a quarter (26 per cent) who thought otherwise. Indian respondents opted for higher government presence at 64 per cent, with 31 per cent preferring an open economy.

Opinion among civil servants and GLCs staff polled was slightly divided with 51 per cent supporting a big role by the government, while 43 per cent preferred an open economy. For respondents from the private sector or self-employed, those opting for a non-GLC economic environment stood at 53 per cent and 55 per cent respectively.

The nationwide survey saw 1,207 registered voters being interviewed through phone calls in the language of their own preference during the December 16 to December 29 period last year, with an estimated margin of error of 2.82 per cent and the randomised stratified sampling method used to ensure results reflect Malaysia's demographics.

The ethnicity breakdown of those polled are 51 per cent Malays, 30 per cent Chinese, seven per cent Indians, and the Bumiputera community from Sabah and Sarawak with 6.5 per cent of them being Muslim and 5.8 per cent being non-Muslim.

Respondents from Sabah and Sarawak both account for 7.8 per cent each and did not only include those who are natives, while the remaining 84.4 per cent are from peninsular Malaysia.